CHAPTER 231, Page 1 (Unofficial Compilation) ADMINISTRATION OF TAXES CHAPTER 231 ADMINISTRATION OF TAXES General Provisions Section 231-1 Definitions 231-1.5 Confidentiality privileges relating to taxpayer communications 231-1.6 Personnel security program; criminal history record checks 231-2 Taxation districts 231-3 Department, general duties and powers 231-3.1 Consideration paid not indicative of fair market value 231-3.2 Repealed 231-3.3 Auditor access to tax records or other information for reviews of exemptions, exclusions, credits, and deductions 231-3.4 Publication of reports 231-3.5 Suspension of running of the period of limitation during bankruptcy proceedings 231-3.6 Streamlined sales and use tax agreement compliance 231-4 Assessing officers eligible to appointment as collecting officers and vice versa 231-4.3 Investigators; appointment and powers 231-4.5 Administrative rules officer; specialists; appointment and duties 231-5 Deceased officers, duties of personal representatives, etc. 231-6 Oath, power to administer 231-7 Audits, investigations, hearings, and subpoenas 231-7.5 Expedited appeals and dispute resolution program 231-8 Timely mailing treated as timely filing and paying 231-8.5 Electronic filing of tax returns 231-8.6 Repealed 231-9 Tax collection; general duties, powers of director; dollar rounding 231-9.2 Offers in compromise 231-9.3 Tax collection; mainland contractors working on federal construction projects 231-9.4 Credit or debit card remittances 231-9.5 Assessment of additional taxes of corporations or partnerships 231-9.6 Fiduciaries, liability 231-9.7 Informalities not to invalidate assessments, mistakes in names or notices, etc. 231-9.8 Tax bills 231-9.9 Filing and payment of taxes by electronic funds transfer 231-10 Department; keep offices where 231-10.5 Closing audit letters 231-10.6 Rules or administrative guidance 231-10.7 Temporary rulemaking authority for regulation of tax matters 231-10.8 Tax clearance fees Police; District Judges 231-11 Police to aid assessing or collecting officers 231-12 Repealed Delinquent Taxes 231-13 Director; examination, investigation, and collection 231-14 Attorney
42
Embed
CHAPTER 231 ADMINISTRATION OF TAXES - …files.hawaii.gov/tax/legal/hrs/hrs_231.pdfSection 231-1 Definitions ... 231-10.5 Closing audit letters 231-10.6 Rules or administrative guidance
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
[§231-1.6] Personnel security program; criminal history record checks. (a)The department shall establish apersonnelsecurityprogramthatensuresabackgroundinvestigationiscompletedattheappropriateleveldesignatedbythefederalgovernmentforanyperson,includinganyauthorizedcontractor,tohaveaccesstofederaltaxinformation.Thisprogramshallincludecriminalhistoryrecordchecksinaccordancewithsection846-2.7.Informationobtainedpursuanttothissubsectionshallbeusedexclusivelybythedepartmentforthepurposeofdeterminingwhetherthepersonissuitableforaccessingfederaltaxinformationinaccordancewithapplicablefederallaws.
(b) Thedepartmentmayterminateordenyemploymenttoanyemployeeorapplicant,orterminateorrefusetosecuretheservicesofanycontractor,ifthedepartmentfindsbyreasonofthebackgroundinvestigationconductedundersubsection(a)thattheemployeeorapplicant,oremployeeoragentofthecontractor,posesarisktothesecurityof federal tax information.Terminationor denial of employment, or terminationor refusal to secure the servicesofanycontractor,under this subsection shallonlyoccurafterappropriatenotification to theemployee, applicant,or employee or agent of the contractor, of the findings of the background investigation, and after the employee,applicant,oremployeeoragentofthecontractorisgivenanopportunitytomeetandrebutthefindings.Nothinginthissubsectionshallabrogateanyapplicableappealrightsunderchapters76and89,oradministrativerulesofthedepartment.
§231-3 Department, general duties and powers. Thedepartmentoftaxationshallhavethefollowingdutiesandpowers,inadditiontoanyothersprescribedorgrantedbythischapter:
(10)Compromises:Withtheapprovalofthegovernor,tocompromiseanyclaimwherethetaxexceeds$50,000(exclusiveofpenaltiesandinterest)arisingunderanytaxlawtheadministrationofwhichiswithinthescopeofthedepartment’sduties,andtocompromiseanytaxclaimwherethetaxis$50,000orless(exclusiveofpenaltiesandinterest)withoutseekingtheapprovalofthegovernor;providedthatthedirectorshallhavethediscretiontoseektheapprovalofthegovernortocompromiseanytaxclaimwherethedirectordeemsitappropriate; and in each case the department shall post each proposed compromise, as set forth insubparagraphs(A)to(D),onthedepartment’sInternetwebsiteforfivecalendardaysbeforethedirectorsignsthecompromise,andthereshallbeplacedonfileinthedepartment’sofficeastatementof:(A) Thenameofthetaxpayerandtheamountandtypeoftaxassessed,orproposedtobeassessed;(B) Theamountofpenaltiesandinterestimposedorwhichcouldhavebeenimposedbylawwithrespect
(12)Remissionofdelinquencypenaltiesandinterest:Exceptincasesoffraudorwilfulviolationofthelawsorwilfulrefusaltomakeareturnsettingforththeinformationrequiredbylaw(butinclusioninareturnofaclaimofnonliabilityforthetaxshallnotbedeemedarefusaltomakeareturn),thedepartmentmayremitanyamountofpenaltiesorinterestadded,underanylawadministeredbythedepartment,toanytaxthatisdelinquent,inacaseofexcusablefailuretofileareturnorpayataxwithinthetimerequiredbylaw,orinacase of uncollectibility of the whole amount due; and in that case there shall be placed on file in thedepartment’sofficeastatementshowingthenameofthepersonreceivingtheremission,theprincipalamountofthetax,andtheyearorperiodinvolved;
(13)Closingagreements:Toenterintoanagreementinwritingwithanytaxpayerorotherpersonrelatingtotheliabilityofthetaxpayerorotherperson,underanylawtheadministrationofwhichiswithinthescopeofthedepartment’sduties,inrespectofanytaxableperiod,orinrespectofoneormoreseparateitemsaffectingtheliability for any taxable period; the agreement, signed by or on behalf of the taxpayer or other personconcerned,andbyoronbehalfofthedepartment,shallbefinalandconclusive,andexceptuponashowingoffraudormalfeasance,ormisrepresentationofamaterialfact:(A) Themattersagreeduponshallnotbereopened,andtheagreementshallnotbemodified,byanyofficer
oremployeeoftheState;and(B) In any suit, action, or proceeding, the agreement, or any determination, assessment, collection,
(14)Otherpowersandduties:Inadditiontothepowersanddutiescontainedinthischapter,thepowersanddutiescontainedinotherchaptersofthelawundertitle14administeredbythedepartmentforlevying,assessing,collecting,receiving,andenforcingpaymentsofthetaximposedthereunder,andotherwiserelatingthereto,shall be severally and respectively conferred, granted, practiced, and exercised for levying, assessing,collecting,receiving,andenforcingpaymentofthetaxesimposedundertheauthorityofthosechaptersasfarastheprovisionsareconsistentwiththeexpressprovisionsofthosechapters,asfullyandeffectuallytoallintentsandpurposesasifthesamepowersandauthoritieswererepeatedinthosechapters,withreferencetothosetaxes,andalloftheprovisionsshallbeapplied,construed,deemed,andtakentorefertothetaxesimposedundertheauthorityofthosechapters,inlikemanner.[L19322d,c40,§§18,20,57,58;RL1935,§1907;RL1945,§5104;amL1945,c79,§2andc196,§1;amL1951,c133,§1;amL1953,c125,§1andc223,§2;RL1955,§115-4;amLSp19592d,c1,§16;HRS§231-3;amL1983,c217,§3;amimpL1984,c90,§1;gench1985;amL1985,c16,§2;amL1986,c340,§2;amL1989,c14,§4(2);amL1990,c320,§2;amL1991,c263,§3;amL1995,c66,§2;amL2003,c136,§3]
[§231-3.3] Auditor access to tax records or other information for reviews of exemptions, exclusions, credits, and deductions. (a)Notwithstandinganyotherlawtothecontrary,thedepartmentshallprovidetotheauditoranytaxrecordsandotherinformationmaintainedbythedepartmentthatarerequestedbytheauditorforthereviewsof:
Any information provided to the auditor under this sectionmarked confidential by the department shall be keptconfidentialbytheauditor,exceptasprovidedinsubsection(b).
(1) The auditor deems necessary and relevant for the purpose of legislative review, including informationreceivedfromthedepartmentoftaxationpursuanttosubsection(a);and
(b) Thedepartment shallmakeeachof these reports available inbothpaper formandcommonlyaccessibleelectronicforms.
(c) Thedepartmentoftaxationshallprovidethereportsrequiredbysubsection(a)(1)and(3)tothelegislaturenolaterthantwentydayspriortotheconveningofeachregularsession;providedthatonorbeforeDecember31,2015,thedepartmentoftaxationshallreporttothelegislatureonthestatusofupgradingitsformsandreportingcapabilitiespertheimplementationofthedepartmentoftaxation’staxsystemmodernization.Thedepartmentoftaxationshallprovide the reports requiredby subsection (a)(2) and (4) to the legislature no later than twentydays prior to theconveningofthe2017regularsessionandeachsessionthereafter.
§231-3.5 Suspension of running of the period of limitation during bankruptcy proceedings. Therunningoftheperiodsoflimitationprovidedunderchaptersofthelawundertitle14administeredbythedepartmenttothecontrarynotwithstanding,shallbesuspendedfortheperiodduringwhichthedirectoroftaxationisprohibitedfrommakinganassessmentoftaxesbyreasonoftitle11(withrespecttobankruptcy)oftheUnitedStatesCodeandforsixtydaysaftertheprohibitionislifted.[L1991,c19,§1;amL1994,c20,§1;amL1995,c66,§3]
[§231-3.6] Streamlined sales and use tax agreement compliance.(a)Asellerthatregisterstopayorcollectandremitsalesorusetaxinaccordancewiththetermsofthestreamlinedsalesandusetaxagreementmayselectoneofthefollowingmethodsofremittanceorothermethodallowedbylawtoremitthetaxescollected,asfollows:
Amonetaryallowancetoacertifiedserviceprovidermaybebasedononeormoreofthefollowingincentives:(1) Abaseratethatappliestotaxabletransactionsprocessedbytheprovider;and(2) For a period not to exceed twenty-four months following a voluntary seller’s registration through the
streamlinedsalesandusetaxagreement’scentralregistrationprocess,apercentageoftaxrevenuegeneratedfor amember state by the voluntary seller for eachmember state forwhich the seller does not have arequirementtoregistertocollectthetax.
(2) For a period not to exceed twenty-four months following a voluntary seller’s registration through thestreamlinedsalesandusetaxagreement’scentralregistrationprocess,apercentageoftaxrevenuegeneratedfor amember state by the voluntary seller for eachmember state forwhich the seller does not have arequirementtoregistertocollectthetax.
(d) Amodel3sellerandallothersellersthatarenotundermodel1ormodel2shallbeallowedamonetaryallowance that the director shall prescribe in accordance with the terms agreed to by the member states of thestreamlinedsalesanduse taxagreement.Thememberstates initiallyanticipate that theywillprovideamonetaryallowancetosellersundermodel3andtoallothersellersthatarenotundermodels1or2basedonthefollowing:
(1) For a period not to exceed twenty-four months following a voluntary seller’s registration through thestreamlinedsalesandusetaxagreement’scentralregistrationprocess;and
§231-4 Assessing officers eligible to appointment as collecting officers and vice versa. Appointeestoofficesorpositionsinthedepartmentoftaxationfortheassessingoftaxesshallbeeligibleforappointmenttoofficesorpositionsinthedepartmentforthecollectionoftaxes,andviceversa.[L19322d,c40,§6;RL1935,§1904;RL1945,§5106;amL1951,c264,§2;RL1955,§115-6;amLSp19592d,c1,§16;HRS§231-4;amL1989,c14,§4(3)]
[§231-4.3] Investigators; appointment and powers. The director may appoint and commission one or moreinvestigatorsastheexigenciesofthepublicservicemayrequire.Personsappointedandcommissionedunderthissectionshallhaveandmayexerciseallofthepowersandauthorityandthebenefitsandprivilegesofapoliceofficerorofadeputysheriff, includingthepower toarrest;providedthatsuchpowersshall remaininforceandeffectonlywhile inactualperformanceoftheirduties.Theseinvestigatorsshallconsistofpersonnelwhoseprimarydutyistoconductinvestigationsasdirectedbythedirector.Personsappointedandcommissionedunderthissectionshallbeexemptfromchapter76. [L2003,c136,§2]
[§231-4.5] Administrative rules officer; specialists; appointment and duties. Thedirectoroftaxationmayappointanadministrativerulesofficer,andadministrativerulesspecialistsasnecessarytoassisttheadministrativerulesofficer.
§231-5 Deceased officers, duties of personal representatives, etc. Thepersonalrepresentativesofanydeceasedofficerofthedepartmentoftaxation,andallotherpersonsintowhosehandsanytaxlists,orrecords,papers,documents,orbooks,ortaxes,maycome,shalldeliverthesametothedepartment,andanyrefusalorwilfulfailuresotodoshallconstituteamisdemeanor.[L19322d,c40,§9;RL1935,§1909;RL1945,§5109;RL1955,§115-9;amLSp19592d,c1,§16;HRS§231-5;amL1976,c200,ptof§1]
§231-6 Oath, power to administer. Thedepartmentoftaxationmayadministeralloathsoraffirmationsrequiredtobetakenorbeadministeredunderchaptersofthelawundertitle14administeredbythedepartment,withrespecttoanymatterscomingwithinthescopeofthedutiesofthedepartment.[L19322d,c40,§10;RL1935,§1916;RL1945,§5110;RL1955,§115-10;amLSp19592d,c1,§16;HRS§231-6;amL1983,c217,§4;amL1985,c16,§3;amL1986,c340,§3;amL1991,c263,§4;amL1995,c66,§4]
§231-7 Hearings and subpoenas. [This section is effective until June 30, 2011. For section effective on July 1, 2011, see below.] (a)Thedirectoroftaxation,andanyrepresentativeofthedirectordulyauthorizedbythedirector,mayconductanyinquiry,investigation,orhearing,relatingtoanyassessment,ortheamountofanytax,orthecollectionofanydelinquenttax,includinganyinquiryorinvestigationintothefinancialresourcesofanydelinquenttaxpayerorthecollectabilityofanydelinquenttax.
(b) The director or other person conducting hearings may administer oaths and take testimony under oathrelatingtothematterofinquiryorinvestigation,andsubpoenawitnessesandrequiretheproductionofbooks,papers,documents,andrecordspertinenttosuchinquiry.
§231-7 Audits, investigations, hearings and subpoenas. [Section is effective July 1, 2011. For section effective until June 30, 2011, see above.] (a)Thedirectoroftaxation,andanyrepresentativeofthedirectordulyauthorizedbythedirector,mayconductanycivilauditorcriminalinvestigation,investigation,orhearing,relatingtoanyassessment,ortheamountofanytax,orthecollectionofanydelinquenttax,includinganyauditorinvestigationintothefinancialresourcesofanydelinquenttaxpayerorthecollectabilityofanydelinquenttax.
(c) Thedirectoroftaxationorrepresentativeofthedirectordulyauthorizedbythedirector,whenconductingacivilaudit,investigation,orhearingmaysubpoenawitnessesandrequiretheproductionofbooks,papers,documents,other designated objects, or any other record howevermaintained, including those electronically stored, that arerelevantormaterialtothecivilaudit,investigation,orhearing;providedthatthedirectoroftaxationordeputydirectoroftaxationshallgivewrittenapprovalfortheissuanceofasubpoenaonlyafterareviewoftheappropriatenessoftheissuance.Asubpoenaissuedunderthissubsection:
(1) Shallstatethatthesubpoenaisissuedbythedepartmentandshallcommandeachpersontowhomit isdirectedtoattendandgivetestimonyatthetimeandplacespecified,andmayalsocommandthepersontowhom the subpoena is directed to produce books, papers, documents, or other objects specificallydesignated;
(3) Shallrequireattendanceofthepersononlyinthecountywhereinthepersonisservedwiththesubpoenaoratanyotherplaceasisagreeduponbythepersonandthedepartment;providedthatifthesubpoenaisserved in a countyother than that inwhich theperson resides, is employed,or transacts theperson’sbusinessinperson,thedepartmentshallbeartheperson’sexpensesfortraveltoandattendanceattheplacenamedinthesubpoenatothesameextentasprovidedbytherulesofcourtotherthantheexpensesofthetaxpayerorthetaxpayer’switnesses,officers,directors,agents,oremployees;and
Ifanypersondisobeysanyprocessor,havingappearedinobediencethereto,refusestoanswerpertinentquestionsput to thepersonby thedirectororotherpersonconducting thecivil audit, investigation,orhearing,or toproduceanybooks,papers,documents,objects,orrecordspursuantthereto,thedirectormayapplytothecircuitcourtofthecircuitwhereinthecivilaudit,investigation,orhearingisbeingconducted,ortoanyjudgeofthecourt,settingforththedisobediencetoprocessorrefusaltoanswer,andthecourtorjudgeshallcitethepersontoappearbeforethecourtorjudgetoanswerthequestionsortoproducethebooks,papers,documents,objects,orrecords;providedthatthecourt,uponamotionpromptlymadebytheperson,mayquashormodifythesubpoenaifcompliancewouldbeunreasonableoroppressiveorwouldviolateanyprivilegethepersonwouldbeentitledtoexerciseinacourtproceeding.Ifthepersonfailsorrefusestoproducethesubpoenaedbooks,papers,documents,objects,orrecord,thecourtshallinstituteacontemptproceedingagainsttheperson,atwhichtimethecourtshalldeterminewhethergoodcauseisshownforthefailuretoobeythesubpoenaortherefusaltotestify;providedthatthecourt,onamotionpromptlymade,mayquashormodifythesubpoenaifcompliancewouldbeunreasonableoroppressiveorwouldviolateanyprivilegethepersonwouldbeentitledtoexerciseinacourtproceeding.Intheeventthatnogoodcauseisshown,thecourtdoesnotquashormodifythesubpoena,andthepersonfailsorrefusestocomplywiththesubpoena,thenthecourtshallcommitthepersontojailuntilthepersontestifies,butnotforalongerperiodthansixtydays.Notwithstandingtheservingofthetermofcommitmentbyanyperson,thedirectormayproceedinallrespectsasifthewitnesshadnotpreviouslybeencalledupontotestify.Witnesses(otherthanthetaxpayerorthetaxpayer’sofficers,directors,agents,andemployees)shallbeallowedtheirfeesandmileageasauthorizedincasesinthecircuitcourts,tobepaidonvouchersofthedepartmentoftaxation,fromanymoneysavailablefortheexpensesofthedepartment.
(d) SubjecttotheprivilegesapplicabletoanywitnessinthisState,thedirectoroftaxationoranyrepresentativeofthedirectordulyauthorizedbythedirector,whenconductingacriminalinvestigation,maysubpoenawitnesses,examinewitnessesunderoath,andrequiretheproductionofanybooks,papers,documents,otherdesignatedobjects,oranyother recordhowevermaintained, including thoseelectronicallystored, thatare relevantormaterial to theinvestigation; provided that the director of taxation or deputy director of taxation shall givewritten approval fortheissuanceofasubpoenaonlyafterareviewoftheappropriatenessoftheissuance.Asubpoenaissuedunderthissubsection:
(g) A person or entity that is compelled to testify or produce documents, information, or other items by asubpoenaissuedpursuanttoanaudit,investigation,orhearingpertainingtoanotherpersonorentityshallnotbeliablefordamagesarisingfromcompliancewiththesubpoena.
§231-7.5 Expedited appeals and dispute resolution program. (a) The department shall be authorized toimplement an administrative appeals and dispute resolution program that shall expeditiously resolve all tax, penalty,interest,fine,assessment,andothersuchdisputesbetweenthedepartmentandthetaxpayerorreturnpreparer.Thedirectororthedirector’sdesignee,whoshallreportdirectlyandbeanswerablesolelytothedirector,shallserveasanindependentappealsofficerandshallbeauthorizedtocompromise,settle,orotherwiseresolveanydisputeonanybasis,includinghazardsandcostsoflitigation,consideringequallythepositionofthetaxpayerandthedepartmentonanimpartialbasis.Theindependentappealsofficershallnotbeinfluencedbyanydepartmenttaxcomplianceinitiativesandpolicies,orlossofrevenuetotheState.Decisionsoftheindependentappealsofficershallbeinwritingstatingthefacts,analysis,andconclusionsinsupport,whichshallbeprovidedtothetaxpayerandreturnpreparer.Personswhocurrentlyserveorhaveservedinthepreviousfiveyearsasanauditor,auditsupervisorormanager,collector,collectionsupervisorormanager,districtmanagerorsupervisor,ortaxcomplianceadministrator,shallnotbeeligibletobethedirector’sdesignee.
(b) Notwithstandinganyotherlawtothecontrary,includingtaxappealproceduressetforthunderchapter232,a taxpayershallbeeligible topetition thedepartmentonceforparticipation in theadministrativeappealsanddisputeresolutionprogramafterissuanceofanoticeofproposedassessment;providedthatifataxpayerhasfiledataxappealwiththetaxappealcourtorothercourt,thetaxpayershallfirstberequiredtoobtaintheapprovalofthedirectorandpermissionfromtherespectivecourtpriortopetitioningthedepartmentforparticipation.Thedirectorshallhavetherighttodenyapetitionforcause.
§231-8 Timely mailing treated as timely filing and paying. (a)Anyreport,claim,taxreturn,statement,orotherdocumentrequiredorauthorizedtobefiledwithoranypaymentmadetotheStatewhichis:
(1) Transmitted through theUnitedStatesmail,shallbedeemedfiledandreceivedby theStateon thedateshown by the post office cancellation mark stamped upon the envelope or other appropriate wrappercontainingit;
(b) Ifanyreport,claim,taxreturn,statement,remittance,orotherdocumentissentbyUnitedStatesregisteredmail,certifiedmail,orcertificateofmailing,arecordauthenticatedbytheUnitedStatesPostOfficeoftheregistration,certification, or certificate shall be considered competent evidence that the report, claim, tax return, statement,remittance,orotherdocumentwasdeliveredtothestateofficerorstateagencytowhichaddressed,andthedateofregistration,certification,orcertificateshallbedeemedthepostmarkeddate.
[§231-8.5] Electronic filing of tax returns. Thedepartmentmayallowfilingbyelectronic,telephonic,oropticalmeansofanytaxreturn,application,report,orotherdocumentrequiredundertheprovisionsoftitle14administeredbythedepartment.Thedateoffilingshallbethedatethetaxreturn,application,report,orotherdocumentistransmittedtothedepartmentinaformandmannerprescribedbydepartmentalrulesadoptedpursuanttochapter91.Thedepartmentmaydeterminealternativemethodsforthesigning,subscribing,orverifyingofataxreturn,application,report,orotherdocumentthatshallhavethesamevalidityandconsequencesastheactualsigningbythetaxpayer.Afilingunderthissectionshallbetreatedinthesamemannerasafilingsubjecttothepenaltiesundersection231-39.[L1997,c176,§1]
§231-8.6 REPEALED. L2007,c9,§22.
§231-9 Tax collection; general duties, powers of director; dollar rounding. (a)Thedirectoroftaxationshallcollectalltaxesaccordingtotheassessments.Thedirectoroftaxationshalldulyandaccuratelyaccounttothedirectoroffinanceforthecollectionandtheamountoftaxesaccordingtosuchassessmentsandshallbeliableandresponsibleforthefullamountofthetaxesassessed,unlessthedirectoroftaxationshallunderoathaccountforthenoncollectionofthesametothefullsatisfactionofthedirectoroffinance,orshallbereleasedfromaccountabilityasprovidedinsection231-32.Thedirectoroftaxationshall,fromtimetotime,payovertothedirectoroffinancealltaxescollected,atsuchtimesasthedirectoroffinanceshalldirect.Thecountyattorneyofeachcountyshall,underthesupervisionanddirectionoftheattorneygeneral,assistthedirectoroftaxationinthecollectionofalltaxes.
(b) Where an offer in compromise is not accepted by the department for any reason, paymentsmade undersubsection(a)shallbeappliedtothetaxfirstassessedorotheramountsimposedundertitle14.
[§231-9.3] Tax collection; mainland contractors working on federal construction projects. The director oftaxationshalldevelopasystemtodeterminewhencontractorsfromtheUnitedStatesmainlandarepresentinHawaiitoworkonfederalprojects,includingthestartingandanticipatedcompletiondatesforthesecontracts,toenforcethelawsrelatingtothecollectionofgeneralexcisetaxesonthesecontractorsthatmayberequiredunderchapter237.
[§231-9.5] Assessment of additional taxes of corporations or partnerships. Additionaltaxesofacorporationorpartnershipshallbeassessedtoitunderitscorporateorfirmname.[L1989,c14,§1(2)]
[§231-9.6] Fiduciaries, liability. Every personal representative, trustee, guardian, or other fiduciary shall beanswerableassuchfortheperformanceofallacts,matters,orthingsasarerequiredtobedoneinrespecttotheassessmentofthetaxesforwhichthefiduciaryisresponsibleinafiduciarycapacity.Thefiduciaryshallbeliableforthepaymentofthosetaxesuptotheamountoftheavailablepropertyheldbythefiduciary,butshallnotbepersonallyliable.Thefiduciarymayretainsomuchpropertyasmaybenecessarytopaythetaxesdue.Thefiduciarymayrecovertheamountoftaxespaidfromthebeneficiarytowhomthepropertyshallhavebeendistributed.[L1989,c14,§1(3)]
[§231-9.7] Informalities not to invalidate assessments, mistakes in names or notices, etc. Noassessmentoractrelatingtotheassessmentorcollectionoftaxesshallbeillegalnorshallsuchassessment,levy,orcollectionbeinvalidonaccountofmereinformalityormistakesinnames,notices,etc.[L1989,c14,§1(6)]
§231-9.9 Filing and payment of taxes by electronic funds transfer. (a)Thedirectoroftaxationisauthorizedtorequireeverypersonwhosetaxliabilityforanyonetaxableyearexceeds$100,000andwhofilesataxreturnforanytax,includingconsolidatedfilers,toremittaxesbyoneofthemeansofelectronicfundstransferapprovedbythedepartment;providedthatforwithholdingtaxesundersection235-62,electronicfundstransfersshallapplytoannualtaxliabilitiesthatexceed$40,000.Notwithstandingthetaxliabilitythresholdsinthissubsection,thedirectoroftaxationisauthorizedtorequireanypersonwhoisrequiredtoelectronicallyfileafederalreturnorelectronicallyremitanyfederaltaxestothefederalgovernment,toelectronicallyfileastatereturnandelectronicallyremitanystatetaxesundertitle14tothedepartment.Thedirectorisauthorizedtograntanexemptiontotheelectronicfilingandpaymentrequirementsforgoodcause.
TaxInformationReleaseNo.95-6,“QuestionsandAnswersonPayingTaxesbyElectronicFundsTransfer”TaxInformationReleaseNo.99-1,“FilingofTaxReturnsRequiredbyTaxpayersWhoPayTaxesbyElectronicFundsTransfer(EFT)”TaxInformationReleaseNo.2004-1,“Act113,SessionLawsofHawaii2004,RelatingtoIncomeTaxWithholding”TaxAnnouncement 2005-01, “Instructions on Filing Federal Schedule B (Form 941), Report of Tax Liability for Semiweekly Schedule
text:(1) Noticestatingthetemporarynatureoftherules;(2) Theexpirationdateofthetemporaryrules;and(3) A statement advising that proposed administrative rules subject to chapter 91 are being simultaneously
§231-11 Police to aid assessing or collecting officers. Thedirectorof taxationor any assessingor collectingofficerofthedepartmentoftaxation,whenresistedorimpededintheexerciseofthedirector’sorassessingorcollectingofficer’soffice,mayrequireanypoliceofficertoaidthedirectororassessingorcollectingofficerinthedischargeofthedirector’sorassessingorcollectingofficer’sduties,andifanypoliceofficerrefusestorenderaid,thepoliceofficershallbedeemedguiltyofamisdemeanor.[L19322d,c40,§11;RL1935,§1918;RL1945,§5114;amL1945,c79,§6;RL1955,§115-15;amLSp19592d,c1,§16;HRS§231-11;amL2017,c12,§32]
§231-13 Director; examination, investigation, and collection. [Repeal and reenactment on June 30, 2017. L 2013, c 93, §4.] (a)Thedirectoroftaxationshallberesponsibleforthecollectionandgeneraladministrationofalltaxes,
Reports to legislature on contracts for the assessment, enforcement, or collection of taxes up through June 30, 2017; annual report of allcontractsto2014-2017legislature.L2013,c93,§2.
§231-15 Returns to be signed. Every return statement, or other document required to be made for taxationpurposesshallbesignedinaccordancewithformsorregulationsprescribedbythedepartmentoftaxation.Whereformsorregulationshavenotbeenprescribed,everysuchreturn,statement,orotherdocumentshallbesignedbythepersonrequiredtomakethereturn,statement,orotherdocumentorbysomedulyauthorizedpersonintheperson’sbehalf.
Thedepartmentoftaxationmayrequirethat,ifanypersonorpersonsactuallyprepareorsignareturnforanotherperson, thepersonorpersonssopreparingorsigning the returnshall signastatementshowingsuchfactsandsuchauthoritytosignsuchreturnasmaybeprescribedbythedepartment,andthedepartmentmaybyregulationdefinetheclassesofpersonstowhomthisprovisionshallapply.
§231-15.6 Returns of corporations or partnerships. Thereturns,statements,oranswersrequiredunderchaptersofthelawundertitle14administeredbythedepartment,inthecaseofacorporation,shallbemadebyanyofficerofthe
§231-15.7 Returns by fiduciaries. Thereturns,statements,oranswersrequiredunderchaptersofthelawundertitle14administeredbythedepartmentshallbemadebythepersonalrepresentative,trustee,guardian,orotherfiduciaryinsuchcapacityinanytaxationdistrictinwhichreturnsarerequired.[L1989,c14,§1(5);amL1991,c263,§7;amL1994,c16,§2;amL1995,c66,§7]
§231-15.8 Time for performing certain acts postponed by reason of service in combat zone. (a)Thissectionshallapplytostatetaxlawssetforthinthistitle14thatprovideforthefilingwiththedirectoroftaxationofareturnorstatementofthetaxorpaymentoftheamounttaxable.
(e) Notwithstandingsubsection(b),anyactionorproceedingauthorizedbysection231-24(regardlessof thetaxable year forwhich the tax arose) aswell as any other action or proceeding authorized by law in connectiontherewith,maybetaken,begun,orprosecuted.Inanyothercaseinwhichthedirectordeterminesthatcollectionoftheamountofanyassessmentwouldbejeopardizedbydelay,subsection(b)shallnotoperatetostaycollectionoftheamountbylevyorotherwiseasauthorizedbylaw.Thereshallbeexcludedfromanyamountassessedorcollectedpursuanttothissubsectiontheamountofinterest,penalty,additionalamount,andadditiontothetax,ifany,inrespectoftheperioddisregardedundersubsection(b).Inanycasetowhichthissubsectionrelates,ifthedirectorisrequiredtogiveanynoticetoormakeanydemanduponanyperson,therequirementshallbedeemedtobesatisfiedifthenoticeordemandispreparedandsigned,inanycaseinwhichtheaddressofthepersonlastknowntothedirectorisin
thebenefitsofthissectioninthesamemannerasiftheserviceswereservicesreferredtoinsubsection(b).(2) Forpurposesof this subsection,“DesertShieldservices”meansanyservices in thearmedforcesof the
§231-16 Copies of returns. Exceptasotherwiseprovidedbylaw,copiesofanytaxreturnfiledwiththedepartmentoftaxationshallbefurnishedtothetaxpayerfilingthereturnortothetaxpayer’srepresentativewhohaswrittenauthorizationtobeprovidedsuchcopiesuponthepaymentof$1perpageand$1foranycertificationthereofbythedepartment.[L1963,c24,§1;Supp,§115-21.5;HRS§231-16;amL1980,c212,§1;amimpL1984,c90,§1;gench1985]
Cross References:
Modificationoffees,see§92-28.
§231-17 Notices, how given. Unlessotherwiseprovided,everynotice,thegivingofwhichbythedepartmentoftaxationisrequiredorauthorized,shallbedeemedtohavebeengivenonthedatewhenthenoticewasmailed,properlyaddressedtotheaddresseeattheaddressee’slastknownaddressorplaceofbusiness.[L1953,c125,§2;RL1955,§115-22;amLSp19592d,c1,§16;HRS§231-17;amimpL1984,c90,§1;gench1985]
§231-18 Tax and other officials permitted to inspect returns; reciprocal provisions. Notwithstanding theprovisionsofanylawmakingitunlawfulforanyperson,officer,oremployeeoftheStatetomakeknowninformationimpartedbyanytaxreturnorpermitanytaxreturntobeseenorexaminedbyanyperson,itshallbelawfulto:
(2) Furnishtoanofficial,commission,ortheauthorizedrepresentativethereofanabstractofthereturnorsupplythe official, commission, or the authorized representative thereofwith information concerning any itemcontainedinthereturnordisclosedbythereportofanyinvestigationofthereturnorofthesubjectmatterofthereturnfortaxpurposesonly;or
[§231-19.3] Disclosure of letter rulings, et al. Notwithstandinganylawtothecontrary,anyandalladvicegivenorcommunicationsmadebythedepartment,includingbutnotlimitedtoletterrulingsanddeterminationletters,containingtaxadvice,shallbedisclosed to thepublicunderstandardsandproceduresundersection6110of thefederal InternalRevenueCodeof1986,asamended,theregulationsthereunder,andfederalcourtinterpretations.[L2009,c166,ptof§16]
Note
Applicabilityofsection. L2009,c166,§27.
[§231-19.5] Public inspection and copying of written opinions. (a) Written opinions shall be open to publicinspectionandcopyingasprovidedinthissection,notwithstandingsections235-116,236D-15,237-34,and237D-13andanyotherlawrestrictingdisclosureoftaxreturnsortaxreturninformationtothecontrary.Exceptasprovidedinsubsection(f),regardingthedisclosureofthetextofwrittenopinions,chapter92Fshallnotapplytotaxreturnsandtaxreturninformation.
(2) Aninformationletter,whichisawrittenstatementissuedbythedepartmentthatprovidesgeneralinformationbycallingattentiontoawell-establishedinterpretationorprincipleoftaxlaw,whetherornotitappliestoaspecificsetoffacts.Aninformationlettermaybeissuedwhenthenatureoftherequestfromthetaxpayersuggests that the taxpayer is seekinggeneral information,orwhere thedepartmentbelieves thatgeneralinformationwillassistthetaxpayer;or
(c) Before making a written opinion available for public inspection and copying under subsection (a), thedepartmentwhere possible shall segregate from the opinion trade secrets or other confidential, commercial, andfinancial information, and identifying details such as the name, address, and social security or tax identificationnumberofthepersontowhomthewrittenopinionpertainsandofanyotherpersonidentifiedinthewrittenopinion.Segregatedtextshallnotbedisclosedunderthissection.
undersections92F-15.5and92F-42(1).Theofficeofinformationpracticesmayexaminethewrittenopinionatissue,incamera,toassistindeterminingwhetherit,oranypartofit,maybewithheld.Indeterminingwhetherinformationconstitutes a trade secret or other confidential, commercial, and financial information, the office of informationpracticesmay consider and apply, in addition to any other relevant sources, interpretations of those terms underchapter92F.
Any person advocating nondisclosure or segregation under paragraph (1) shall have the burden of proof andpersuasion,butanypersonunderparagraph(2)needonlyestablishthedenialofarequestandthedepartmentshallhavetheburdenofproofandpersuasiontojustifythedenialoftherequesttoinspectandcopy.
(h) Uponappeal to theofficeof informationpracticesoracourtunder subsection (f), thewrittenopinionatissueshallnotbemadeavailableforpublicinspectionandcopyingpendingthefinaldecisioninthecase.Ifthefinaldecisioninthecasedeterminesthatthewrittenopinionsubjecttotheappealshallbeopenandavailabletopublicinspectionandcopying,orthatconfidentialoridentifyinginformationmustbesegregated,thenthedepartmentshallmake thewrittenopinion available forpublic inspection and copyingnot later than thirtydays after thedecisionbecomesfinal.Theofficeofinformationpracticesorthecourtmayextendthisthirty-dayperiodforsuchtimeastheofficeofinformationpracticesorthecourtfindsnecessarytoallowthedepartmenttocomplywithitsdecision.
(i) The department shall compile yearly an index in such form as the department determines of allwrittenopinionsissuedduringtheprecedingcalendaryear.Copiesoftheindexshallbefurnisheduponthepaymentof50centsapage.Copiesofwrittenopinionsshallbefurnisheduponthepaymentof$1apage.
§231-20 Evidence, tax records as. Inrespectofeverytaxtheadministrationofwhichiswithinthescopeofthedepartmentoftaxation’sdutiesandexceptasotherwisespecificallyprovidedinthelawimposingthetax,thenoticesofassessments,recordsofassessments,andlistsorotherrecordsofpaymentsandamountsunpaid,preparedbyorundertheauthorityofthedepartment,orcopiesthereof,shallbeprimafacieproofoftheassessmentofthepropertyorpersonassessed,theamountdueandunpaid,andthedelinquencyinpayment,andthatallrequirementsoflawinrelationtheretohavebeencompliedwith.[L19322d,c40,§4;RL1935,§1911;RL1945,§5127;amL1953,c125,§3;RL1955,§115-25;amLSp19592d,c1,§16;HRS§231-20]
§231-21 Due date on Saturday, Sunday, or holiday. WhentheduedateforanyremittanceordocumentrequiredbyanylawimposingataxfallsonaSaturday,Sunday,orlegalholiday,theremittanceordocumentshallnotbedueuntil
Civilunionpartnershaveallthesamerights,benefits,protections,andresponsibilitiesunderthelawasmarriedcoupleswhoareoftheoppositegender;civilunionpartnershave thesame taxfilingstatusoptionsasmarriedcoupleswhoareof theoppositegender forHawaii income taxpurposesfortaxableyearsbeginningafterDecember31,2011.Att.Gen.Op.11-2.
ADJUSTMENTS AND REFUNDS
§231-22 REPEALED. L1989,c14,§21.
§231-23 Adjustments and refunds. (a) This subsection shall apply to all taxes except those collected underchapter247andthosecollectedunderachaptercontainingaprovisionforcreditandrefundoftheamountoftaxpaidinexcessofthetaximposedbysuchchapter.Astoalltaxpaymentsforwhicharefundorcreditisnotauthorizedbythissubsection(includingwithoutprejudicetothegeneralityofthecasesofunconstitutionalityhereinaftermentionedin(1)(C))theremediesprovidedbyappealorundersection40-35areexclusive.
(1) Allrefundsshallbepaidonlyuponaformtobeknownasa“refundvoucher”preparedbythecollector.Therefundvouchersshallsetforthallthedetailsofeachtransaction,shallbeapprovedbythedirector,andshallbe forwarded to the comptroller from time to time.The comptroller shall issue awarrant, in the formprescribedbysection40-52, for thepaymentofanysuch refundoutof the tax reserve fundhereinaftercreated; provided that if the person entitled to the refund is delinquent in the payment of any tax, thecomptroller,upondemandofthecollectorandafternoticetothedelinquenttaxpayer,shallwithholdtheamountofthedelinquenttaxes,togetherwithpenaltiesandinterestthereon,fromtheamountoftherefundandpaythesametothecollector.
§231-24 Jeopardy assessments, etc. (a)IfthedepartmentoftaxationdeterminesthatataxpayerdesignstodepartquicklyfromtheState,ortoremovethetaxpayer’spropertytherefrom,ortoconcealthetaxpayer’sselforthetaxpayer’spropertytherein,ortodoanyotheracttendingtoprejudiceorjeopardize,inwholeorinpart,theassessmentorcollectionofanytaxtheadministrationofwhichiswithinthescopeofthedepartment’sduties,thedepartmentshallcausenoticeofthedeterminationtobegiventothetaxpayeraddressedtothetaxpayer’slastknownaddressorplaceofbusiness.Thedeterminationbythedepartmentshallbeforallpurposespresumptiveevidenceofthetaxpayer’sdesign.
§231-25 Payment, enforcement of by assumpsit action or by levy and distraint upon all property and rights to property. (a)Ifanytaxbeunpaidwhendue,thedirectoroftaxationmayproceedtoenforcethepaymentofthesame,withallpenalties,asfollows:
(1) Byactioninassumpsit,inthedirector’sownname,onbehalfoftheState,fortheamountoftaxesandcosts,or, if the tax is delinquent, for the amount of taxes, costs, penalties, and interest, in any district court,irrespectiveoftheamountclaimed.Executionmayissueuponanyjudgmentrenderedinanysuchactionwhichmaybesatisfiedoutofanyrealorpersonalpropertyofthedefendant;and
subject to levy uponwhich a levy has beenmade, upon demand of the director or the director’srepresentative,shallsurrenderthepropertyorrights(ordischargetheobligation)tothedirectororthedirector’srepresentative,exceptthatpartofthepropertyorrightsasis,atthetimeofthedemand,subjecttoanattachmentorexecutionunderanyjudicialprocess;
(B) Extentofpersonalliability.Anypersonwhofailsorrefusestosurrenderpropertyorrightstoproperty,subject to levy,upondemandby thedirectoror thedirector’s representative,shallbe liable in theperson’sownpersonandestatetotheStateinasumequaltothevalueofthepropertyorrightsnotsosurrendered,butnotexceedingtheamountoftaxesforthecollectionofwhichthelevyhasbeenmade,togetherwithcostsandinterestonthesumattherateofeightpercentayearfromthedateofthelevy.Anyamount(otherthancosts)recoveredunderthissubparagraphshallbecreditedagainstthetaxliabilityforthecollectionofwhichthelevywasmade;
(D) Unemployment benefits. Any amount payable to an individual with respect to the individual’sunemployment (including any portion thereof payable with respect to dependents) under anunemploymentcompensationlawoftheUnitedStatesortheState;and
(E) Redemptionofproperty. If theownerof thepropertyseizeddesires to retainor regainpossessionthereof,theownermaygiveasufficientbondwithsuretytoproducethepropertyatthetimeandplaceofsale,orpayalltaxes,penalties,interest,costs,andexpenses.[L19322d,c40,§69;RL1935,§1963;RL1945,§5131;amL1949,c311,§1(b);amL1955,c246,§1;RL1955,§115-30;amLSp19592d,c1,§16;amL1967,c37,§1;HRS§231-25;amL1972,c83,§2;gench1985;amL1989,c211,§10;amL1990,c281,§11;amL1998,c2,§66;amL2002,c153,§3;amL2013,c44,§1]
§231-25.5 Cost recovery fees for the administration of taxes. (a)Thedepartmentmaychargeandaddafeetoanyamountdueinaccordancewiththedepartment’sdutiesandpowersundersection231-3for:
18-231-25.5
CHAPTER231,Page25(UnofficialCompilation)
ADMINISTRATION OF TAXES §231-27
(1) Anycostorexpenseincurredbythedepartmentasaresultofanyactiontakentoenforcethecollectionoftaxes administered under title 14, including levy, seizure, foreclosure, and other similar acts, after thedepartmenthasmailedwrittennoticedemandingpaymentandadvisingthatcontinuedfailure topaytheamountduemayresultincollectionaction,includingtheimpositionoffeespursuanttothissection.Anysuchfeechargedagainstthetaxpayerforcosts,fees,andothercharges,mayincludeattorneys’fees,collectionagencyfees,courtfilingfees,recordingfees,andsimilarfees,incurredbythedepartmentinconnectionwiththecollectionaction;
(e) The department shall prescribe the procedures relating to the charging of fees, the waiver of fees, thedocumentsandservicesforwhichthefeesmaybecharged,andtheamountofthefees,increasingordecreasingthefeesasnecessary,pursuanttorulesadoptedunderchapter91.[L1995,c14,§1;amL1996,c131,§1]
§231-26 Extraterritorial enforcement of tax laws. (a)ThecourtsoftheStateshallrecognizeandenforcetheliabilityfortaxeslawfullyimposedbythelawsofanystatewhichextendsalikecomity,whetherbystatuteorcaselaw,inrespectoftheliabilityfortaxeslawfullyimposedbythelawsofthisState.Shouldaclaimbemadeinthestatecourtsfortaxesbyastatewhosehighestcourthasnotyetpasseduponthequestionofenforcingextraterritorialrevenuelaws,thecourtsoftheStateshallenforcesuchclaimsuntilsuchtimeasthehighestcourtofthatstateprohibitstheenforcementofextraterritorialrevenuelaws.
§231-29 Joinder of party defendant when State claims tax liens. Thedirectoroftaxation(orinthecaseofalienunderchapter383,thedirectoroflaborandindustrialrelations)maybenamedapartydefendantinanycivilactioninanystatecourtofcompetentjurisdictionorinthedistrictcourtoftheUnitedStatesforthedistrictofHawaii,toquiettitletoorfortheforeclosureofamortgageorotherlienuponrealorpersonalpropertyonwhichtheStatehasorclaimsataxlienunderchaptersofthelawundertitle14administeredbythedepartmentorchapter383;providedthatthejurisdictionconferredbythissectionshallbelimitedandshallnotoperateasaconsentbytheStatetobesuedastoitsclaimoftitletoorliensandencumbrancesonrealandpersonalpropertyotherthantheliensaforementioned.Serviceuponthedirectorshallbemadeasprovidedbytherulesofcourt.Inanyactioncontemplatedunderthissection,thedirectormayask,bywayofaffirmativerelief,fortheforeclosureoftheaforementionedstatetaxliens,butintheabsenceofsuchrequestforaffirmativerelief,uponanyforeclosuresalethepropertyshallbesoldsubjecttothetaxliens.Nothinginthissectionshallprecludethedirectorfromaskingforsuchotherandfurtherreliefasmighthavebeenclaimedbyinterventionintheaction.[L1953,c187,§1;RL1955,§115-34;amL1957,c185,§4;amLSp19592d,c1,§16;HRS§231-29;amL1973,c133,§1;amL1985,c16,§6;amL1986,c340,§6;amL1991,c263,§9;amL1995,c66,§9]
§231-31 Nonresidents engaged in business, etc., service of process on, designation of agent for service of process. Everynonresidentindividualwho,jointly,severally,orjointlyandseverally,issubjecttoataxuponthegrossornetincomefrom,orsalesof,anoccupation,trade,orbusinesscarriedonintheState,inwholeorinpart,oruponthecarryingonofsuchoccupation,trade,orbusiness,orupontheuseorkeepingforuseofpropertytherein,shallfilewiththedepartmentoftaxationinthedistrictinwhichtheoccupation,trade,orbusinessiscarriedon,thenameandaddress
§231-32 Records of delinquent taxes, uncollectible delinquent taxes. Thedepartmentoftaxationshallprepareandmaintain,opentopublicinspection,acompleterecordoftheamountsoftaxesassessedineachdistrictthathavebecomedelinquentwiththenameofthedelinquenttaxpayerineachcase,butitshallnotbenecessarytoperiodicallycomputeontherecordstheamountofpenaltiesandinterestupondelinquenttaxes.
§231-33 Tax debt due the State; lien. (a)Withinthemeaningofthissection:(1) The terms“mortgagee”, “pledgee”, and“purchaser”donot includeanyperson towhompropertyoran
(e) Subject to theprovisionsof this subsection, the lien imposedby subsection (b) is not valid as against amortgagee,pledgee,orpurchaserwhogivesnotice to thedepartmentona formprescribedby itof themortgage,pledge,orpurchasemadeorabouttobemade,withadescriptionofthepropertyencumberedorconveyedorproposedtobeencumberedorconveyedthereby,andwhoseinterestinthepropertyarisespriortotherecordingorfilingbythedepartmentofthecertificateprovidedforbysubsection(f)orwithintendaysafterthefiling.Ifthenoticeisgiventhelienimposedbysubsection(b)isvalidagainstthepartygivingthenotice,astoanytaxessetforthinacertificatefiledasprovidedinsubsection(f)withintheperiodoffifteendaysafterthenotice.Thedepartmentmaywaivealloranypartoftheperiodhereinallowed.
§231-34 Attempt to evade or defeat tax. Anypersonwhowilfullyattemptsinanymannertoevadeordefeatanytaximposedundertitle14,oritspayment,inadditiontootherpenaltiesprovidedbylaw,shallbeguiltyofaclassCfelonyand,uponconviction,shallbesubjecttooneoranycombinationofthefollowing:
§231-35 Wilful failure to file return, supply information, or secure a license. Anypersonrequiredtomakeareturn,makeareport,keepanyrecords,supplyanyinformation,orsecureanylicenserequiredundertitle14,whowilfullyfailstomakethereturn,makethereport,keeptherecords,supplytheinformation,orsecurethelicense,atthetimeortimesrequiredbylaw,shallinadditiontootherpenaltiesprovidedbylaw,beguiltyofamisdemeanoranduponconviction,shallbesubjecttooneoranycombinationofthefollowing:
§231-36 False and fraudulent statements; aiding and abetting. (a) Any person who wilfully makes andsubscribesanyreturn,statement,orotherdocumentrequiredtobemadeundertitle14,exceptchapter238,whichcontainsorisverifiedbyawrittendeclarationthatitistrueandcorrectastoeverymaterialmatter,andwhichthepersondoesnotbelievetobetrueandcorrectastoeverymaterialmattershallbeguiltyofaclassCfelonyand,uponconviction,shallbesubjecttooneoranycombinationofthefollowing:
Where,pursuantto§231-40,theCheekinterpretationofthewilfulnessrequirement--thatajurymustbepermittedtoconsiderevidenceofadefendant’sgoodfaithbeliefthatdefendant’sconductdidnotviolatethetaxlaws,evenifthatbeliefwasnotobjectivelyreasonable,indeterminingwhetherdefendant actedwilfully--was adoptedandapplied in construing subsection (a), the trial court erred in excludingdefendant’s exhibitpursuanttoHRErules401and403onthegroundsthatdefendant’sanalysisofthetaxlawswasirrelevantandthatevidenceofdefendant’slegaltheorieswouldconfusethejury.119H.60(App.),193P.3d1260(2008).
[§231-36.4] Wilful failure to collect and pay over tax. Anypersonrequiredtocollect,accountfor,andpayoveranytaximposedbytitle14,whowilfullyfailstocollectortruthfullyaccountforandpayoversuchtaxshallbeguiltyofaclassCfelony,inadditiontootherpenaltiesprovidedbylawand,uponconviction,shallbesubjecttooneoranycombinationofthefollowing:
[§231-36.5] Understatement of taxpayer’s liability by tax return preparer. (a)Ataxreturnpreparerwhounderstatesaperson’staxliabilitybaseduponunreasonablepositionsonataxreturnorclaimfortaxrefundshallpayapenaltyof$500withrespecttoeachsuchtaxreturnorclaimfortaxrefund.
remainderofthepenaltyshallbecommencedexceptinaccordancewithsubsection(e).(e) Anaction that isstayedpursuant tosubsection(d)maybebroughtthirtydaysaftereitherofthefollowing
response to anywaiver of restriction after the commencement of an audit of the taxpayer, or of anothertaxpayerifadeterminationintheauditoftheothertaxpayerdirectlyorindirectlyaffectsthetaxliabilityofthetaxpayer.
“Understatement of liability” shall have the samemeaning as stated in section 231-36.6(b).The determinationofwhetherthereisanunderstatementofliabilitymaybemadewithoutregardtoanyadministrativeorjudicialactioninvolvingthetaxpayer.
[§231-36.6] Substantial understatements or misstatements of amounts; penalty. (a)Thereshallbeaddedtothetaxanamountequaltotwentypercentoftheportionofanyunderpaymentthatisattributabletoanysubstantialunderstatementofanytaxinataxableyear.Thepenaltyunderthissectionshallbeinadditiontoanyotherpenaltyassessablebylaw.
(c) At the requestof thedirectorof taxation, a civilactionmaybebrought toenjoinanypersondescribed insubsection(a)fromengaginginanyconductdescribedinsubsection(a).Anyactionunderthissectionshallbebroughtinthecircuitcourtofthecircuitwherethepersoninsubsection(a)residesorwheretheperson’sprincipalplaceofbusinessislocated.ThecourtmayexerciseitsjurisdictionovertheactionseparateandapartfromanyotheractionbroughtbytheStateagainstthosepersonsdescribedinsubsection(a).Ifthecourtfindsthatapersondescribedinsubsection(a)hasengagedinanyconductsubjecttopenaltyundersubsection(b)andthatinjunctivereliefisappropriatetopreventtherecurrenceofthatconduct,thecourtmayenjointhepersonaccordingly.
§231-36.8 Erroneous claim for refund or credit. (a)Ifaclaimforrefundorcreditwithrespecttotaxismadeforanexcessiveamount,thepersonmakingtheclaimshallbeliableforapenaltyinanamountequaltotwentypercentoftheexcessiveamount;providedthatthereshallbenopenaltyassessedwherethepenaltycalculationunderthissectionresultsinanamountoflessthan$400.
exceedstheamountoftheclaimallowableforsuchtaxableyear.“Reasonablebasis”meansastandardofcareused in taxreporting that issignificantlyhigher thannotfrivolous
or not patently improper.A reasonable basis positionwill bemore than arguable andbased on at least one ormoreauthoritiesofeitherstateorfederaltaxadministration.Apositionisconsideredtohaveareasonablebasisifareasonableandwell-informedanalysisbyapersonknowledgeableintaxlawwouldleadthatpersontoconcludethatthepositionhasapproximatelyaone-in-four,orgreater,likelihoodofbeingsustainedonthemerits.Areasonablebasisincludesinnocentmistakeswhere theexcessiveamount is theresultof inadvertence,mathematicalerror,orwhereotherwisedefinedasinnocentbythedirectorpursuanttoaformalpronouncementissuedwithoutregardtochapter91.
§231-37 Neglect of duty, etc., misdemeanor. Any officer of the department of taxation, the state director offinance,anypersondulyauthorizedbythedirectoroftaxation,oranypoliceofficer,onwhomdutiesareimposedunderthischapter,whowilfullyfailsorrefusesorneglectstoperformfaithfullyanydutyordutiesasrequiredbythischapter,shallbedeemedguiltyofamisdemeanor.[L19322d,c40,§12;RL1935,§1915;RL1945,§5137;amL1945,c79,§7;RL1955,§115-41;amLSp19592d,c1,§§14,16;amL1963,c114,§1;HRS§231-37;amL1974,c139,§2;amL2017,c12,§34]
§231-38 REPEALED. L1995,c92,§21.
§231-39 Additions to taxes for noncompliance or evasion; interest on underpayments and overpayments. (a)Exceptasotherwiseprovided,thissectionshallapplytoeverytaxorrevenuelawoftheStatethatprovidesforthefilingwiththedirectoroftaxationofareturnorstatementofthetaxortheamounttaxable.
(1) Failuretofiletaxreturn.Incaseoffailuretofileanytaxreturnrequiredtobefiledonthedateprescribedtherefor(determinedwithregardtoanyextensionoftimeforfiling),unlessitisshownthatthefailureisduetoreasonablecauseandnotduetoneglect,thereshallbeaddedtotheamountrequiredtobeshownastaxonthe returnfiveper centof the amountof the tax if the failure is fornotmore thanonemonth,with anadditionalfivepercentforeachadditionalmonthorfractionthereofduringwhichthefailurecontinues,notexceedingtwenty-fivepercentintheaggregate.Forpurposesofthisparagraph,theamountoftaxrequiredtobeshownonthereturnshallbereducedbytheamountofanypartofthetaxwhichispaidonorbeforethedateprescribedforpaymentofthetaxandbytheamountofanycreditagainstthetaxwhichmaybeclaimeduponthereturn.Thisparagraphshallnotapplytoanyfailuretofileadeclarationofestimatedtaxrequiredbysection235-97.
Costrecoveryfeesfortheadministrationoftaxes,see§231-25.5.TaxInformationReleaseNo.92-2,“TheAdministrationandApplicationoftheConveyanceTaxLaw”Tax Information Release No. 2008-03, “Deposits in the Nature of Cash Bond Made to Suspend the Running of Interest on Potential
[§231-40.5] Statute of limitations; extension for substantial omissions. (a)Notwithstandinganyotherlawtothecontrarylimitingthetimeforassessmentofanytax,ifataxpayeromitsanamountof:
(b) Indetermininganyamountomitted, there shall notbe taken intoaccountanyamount that is stated in thereturnifsuchamountisdisclosedinthereturnorinastatementattachedtothereturninamanneradequatetoapprisethedepartmentoftaxationofthenatureandamountofsuchitem.
§231-41 Statute of limitation for criminal penalties. Notwithstanding any laws to the contrary, prosecutionsundersections231-34,231-35,231-36,and231-36.4shallbecommencedwithinsevenyearsafterthecommissionoftheoffense.[L1995,c92,ptof§2;amL2009,c166,§23;amL2011,c43,§4]
[§231-53] Setoff against refund. TheState,throughthedepartmentofaccountingandgeneralservices,uponrequestofaclaimantagency,shallsetoffanyvaliddebtdueandowingaclaimantagencybythedebtoragainstanydebtor’srefund.Anyamountoftherefundinexcessoftheamountretainedtosatisfythedebtshallberefundedtothedebtor.[L1982,c199,ptof§1]
[§231-54] Hearings; appeals. At the time a setoff is identified, the debtor shall be notified by the comptroller,departmentofaccountingandgeneralservices,oftheState’sintentiontoapplythedebtor’sdebtagainsttherefund.Thenoticeshallstatethatthedebtorwithinthirtydaysmayrequestahearingbeforetheclaimantagencytocontestthesetoff.Noissuesthathavebeenpreviouslylitigatedshallbeconsideredatthehearing.Appealsfromthehearingallowedunderthissectionshallbeinaccordancewithchapter91.[L1982,c199,ptof§1]
[§231-55] Finalization of setoff; credit on debt. Uponcompletionof thehearingandappealprocesssetout insection231-54,oruponthedebtor’sfailuretotimelyrequestahearingpursuanttothatsection,thesetoffshallbecomefinal.Theamountofthesetoffafterdeductionofanychargeauthorizedbysection231-56shallbecreditedbytheclaimantagencyagainstthedebtor’sdebt.[L1982,c199,ptof§1]
[§231-56] Charges for setoff; credit to agency. TheStatemaychargetheclaimantagencyforthecostofthesetoff;providedthatthechargesshallnotexceedtheproceedsofthecollection.TheStatemaydesignateasinglepercentagetoberetainedfromtheproceedsofthesetoffasachargeforcostofassistance.Thenetproceedsofasetoff,afterdeductionofanycharge,shallbecreditedtotheclaimantagency’saccountorfund.[L1982,c199,ptof§1]
[§231-57] Apportionment of joint refunds. Inthecaseofasetoffagainstajointincometaxrefund,theStatemaymakeseparaterefundsofwithheldtaxesuponrequestbyahusbandorwifewhohasfiledthejointreturn.TherefundpayabletoeachspouseshallbeproportionedtothegrossearningsofeachshownbytheinformationreturnsfiledbytheemployerorotherwiseshowntothesatisfactionoftheState.[L1982,c199,ptof§1]
§231-57.5 Notification of address and social security number of debtor parent. Thedepartmentofaccountingandgeneralservicesshallnotifythechildsupportenforcementagencyoftheaddressandsocialsecuritynumberofeachdebtorwhohasbeensubjecttoasetoffbecauseofachildsupportdebt.[L1986,c332,§3]
§231-62 Tax liens; foreclosure; property. (a) Upon enforcement or foreclosure by the State, in anymannerwhatsoever,ofanystatetaxlienonrealproperty,allstatetaxesofwhatsoevernatureandhowsoeveraccruinganddueatthetimeoftheforeclosuresalefromthetaxpayeragainstwhosepropertythetaxlienissoenforcedorforeclosedshallbesatisfiedasfaraspossibleoutoftheproceedsofthesaleremainingafterpaymentofthe:
[§231-65] Tax liens; notice, form of. Thenoticeofsaleshallcontainthenamesofthepersonsassessed,thenamesofthepresentowners(sofarasshownbytherecordsofthetaxofficeandtherecords,ifany,intheofficeoftheassistantregistrarofthelandcourt),thecharacterandamountofthetax,andthetaxyearoryears,withinterest,penalties,costs,expenses,andchargesaccruedortoaccruetothedateappointedforthesale,abriefdescriptionofthepropertytobesold,andthetimeandplaceofsale,andshallwarnthepersonsassessed,andallpersonshavingorclaimingtohaveanymortgageorotherlienthereonoranylegalorequitableright,title,orotherinterestintheproperty,thatunlessthetax,withallinterest,penalties,costs,expenses,andchargesaccruedtothedateofpayment,ispaidbeforethetimeofsaleappointed,thepropertyadvertisedforsalewillbesoldasadvertised.Thestatetaxcollectormayincludeinoneadvertisementofnoticeofsalenoticeofforeclosureuponmorethanoneparcelofrealproperty,whetherornotownedbythesamepersonandwhetherornottheliensareforthesametaxyearoryears.[L1989,c14,ptof§1(1)]
[§231-66] Tax liens; postponement of sale, etc. Ifatthetimeappointedforthesalethestatetaxcollectordeemsitexpedientandfortheinterestofallpersonsconcernedthereintopostponethesaleofanypropertyorpropertiesforwantofpurchasers,orforothersufficientcause,thestatetaxcollectormaypostponethesalefromtimetotime,untilthesaleiscompleted,givingnoticeofeveryadjournmentbyapublicdeclarationthereofatthetimeandplacelastappointedforthesale;providedthatthesaleofanypropertymaybeabandonedatthetimefirstappointedoranyadjourneddate,ifnoproperbidisreceivedsufficienttosatisfythelien,togetherwithallinterest,penalties,costs,expenses,andcharges.[L1989,c14,ptof§1(1)]
PartrepealedonJune30,2014.L2009,c134,§13(3).The2013 amendment repealsSection13(3)ofAct 134,SLH2009 effectiveApril 30, 2013.Deletes the sunset provisions for the special
(6) Compile information received by third parties, including taxpayers, competitors, government agencies,confidentialsources,orpublicsourcesanddelegatethisinformationwithinthedepartmentforproperhandling.Properhandlingmayincludereferralinternallytoothercivilorcriminalenforcementsections;
§231-83 Investigators and personnel, appointment and power. (a) The director of taxation may appoint,commission,ordetail to thespecialenforcementsectiononeormorepersonsas investigators, investigatorassistants,andothersupportstaffas theexigenciesof thepublicservicemayrequire. Investigatorsmaybe legaloraccountingprofessionals; provided that their primary duty is to conduct investigations pursuant to the authorities of the specialenforcementsectionandtheyshallnotconductorparticipateincriminalinvestigationsofthetaxlawsorrenderlegaladvice.Investigatorsmayserveprocessandapplyforandexecutesearchwarrantsorwritsofentrypursuanttosection231-84butshallnototherwisehavethepowersofapoliceofficerordeputysheriff.
(b) Notwithstandinganyother law to thecontrary relating toemployment,bargaining, labor,orcompensationrightsorduties,anypersonappointed,commissioned,ordetailedtothespecialenforcementsection:
§231-84 Right to inspection of books, records, and premises; warrants and writs; levy and seizure. (a)Uponpresentingcredentials,thespecialenforcementsectionmayexamineanybooks,papers,records,andanyarticleoritemof businesstransactedofanypersonengagedinbusinessinthisStatetoverifytheaccuracyofthereportingandpaymentofthetaxesimposedbylaw.Everypersoninpossessionofanybooks,papers,records,orarticlesoritemsofbusinesstransacted,andtheperson’sagentsandemployees,shallprovidethespecialenforcementsectionthemeans,facilities,andopportunitiesfortheexaminationsuponrequest,totheextentreasonablypossibleunderthecircumstances.
§231-85 Identification of cash-economy cases; retention of funds. Notwithstanding any law to the contrary,eachfiscalyear,thespecialenforcementsectionmayidentifyanytaxpayer,assessment,investigation,orcollectionmatterasamatterofthespecialenforcementsection.Allrevenuescollectedfromspecialenforcementsectionmattersshallbedepositedintothetaxadministrationspecialfund.[L2009,c134,ptof§2;amL2013,c58,§1]
§231-86 Violent interference with a tax official. Any personwho interferes, hinders, obstructs, prevents, orimpedesanyinvestigatororemployeeofthedepartmentwithviolenceorthreatofviolence,shallbeguiltyofaclassCfelonyand,uponconviction,shallbesubjecttooneoranycombinationofthefollowing:
PartrepealedonJune30,2014.L2009,c134,§13(3).The2013 amendment repealsSection13(3)ofAct 134,SLH2009 effectiveApril 30, 2013.Deletes the sunset provisions for the special
§231-91 Citations for violations; deposits. (a) The special enforcement section may issue cease and desistcitationstoanypersonifthespecialenforcementsectionhascausetobelievethepersonhasviolated,isviolating,orisabouttoviolateanyprovisionoftitle14oradministrativeruleadoptedthereunder.Aceaseanddesistcitationmayincludeamonetaryfineforanyunlawfulact.
(e) Cease and desist citations may be appealed to the director of taxation or the director’s designee, and thedeterminationofthedirectormaybeappealedtothecircuitcourt,pursuanttochapter91.[L2009,c134,ptof§2;amL2013,c58,§1]
§231-92 Cash-based businesses; injunction. The special enforcement section, with the director of taxation’sapproval,maybringcivilactionsinthecircuitcourtwherethecash-basedbusinessislocatedtoenjoinanyunlawfulactundertitle14,includinganyadministrativeruleadoptedthereunder,byacash-basedbusiness.Totheextentprovidedbystatute,thespecialenforcementsectionmayincludeinanyactionanassessmentofamonetaryfine.[L2009,c134,ptof§2;amL2013,c58,§1]
§231-93 Cash-based business; defined. For purposes of sections 231-91 to 231-100, “cash-based business”meansanypersonwhooperatesabusiness,includingfor-profitornot-for-profit,wheretransactionsingoodsorservicesareexchangedsubstantiallyforcashandwherethebusinessisfound,baseduponreasonablecauseincludingobservationorevidence,tohavemetoneofthefollowingfactors:
§231-94 Failure to produce license upon demand. Everypersonrequiredtobelicensedorpermittedundertitle14,whetherornotsolicensedorpermitted,shallberequiredtoproducethelicenseorpermitupondemandbythespecialenforcementsection.Failuretoproducethelicenseorpermitupondemandshallbeunlawful.Anypersonwhoviolatesthissectionshallbesubjecttoafinenottoexceed$500;providedthatifthepersonisacash-basedbusiness,thefineshallnotexceed$1,000.Itshallbeanabsolutedefensetothissectionifthepersonproducesalicenseorpermitnumberonfilewiththedepartmentandthedepartmentconfirmsthatthepersonassociatedwiththenumberistrueandaccurate.[L2009,c134,ptof§2;amL2013,c58,§1]
§231-95 Failure to keep adequate books and records. Itshallbeunlawfulforanypersonrequiredundertitle14tokeepbooksorrecordstofailtoproducethebooksorrecordsupondemandbythespecialenforcementsection,orassoonthereafterasisreasonableunderthecircumstances.Anypersonwhoviolatesthissectionshallbesubjecttoafinenottoexceed$1,000;providedthatifthepersonisacash-basedbusiness,thefineshallnotexceed$2,000.[L2009,c134,ptof§2;amL2013,c58,§1]
§231-96 Failure to record transaction. (a) Itshallbeunlawfulforanypersondoingbusinessunderchapter237,otherthancasualsales,toconductanytransactionincashandfailto:
§231-99 Possession of currency for tax avoidance purposes. It shallbeunlawful for anypersonengaged inbusinessinthisStatetopossesscurrencyintheformofcoinornote,wherethepossessionisfortaxavoidancepurposes.It shall be the department’s burden to establish that currency is possessed for tax avoidance purposes; provided thatcircumstantialevidencemaybeusedbythedepartmentinanyproceeding.Anypersonwhoviolatesthissectionshallbesubjecttoafinenottoexceed$2,000;providedthatifthepersonisacash-basedbusiness,thefineshallnotexceed$3,000.[L2009,c134,ptof§2;amL2013,c58,§1]
§231-100 Interference with a tax official. It is unlawful for any person to intentionally interferewith, hinder,obstruct,prevent,orimpedeanyinvestigator,auditor,collector,orotheremployeeofthedepartmentfromobtaininglicenseinformation,books,records,articles,oritemsofbusinesstransacted,orotherinformationorpropertyrightfullyentitledthedepartment.Anypersonwhoviolatesthissectionshallbesubjecttoafineofnotmorethan$2,000.Itshallbeanabsolutedefensetothefineunderthissectionthatthepersonactedwithgoodcause.[L2009,c134,ptof§2;amL2013,c58,§1]